Looking for the cheapest car loan?
Via www.credit-auto.be you can compare the rates of 20 banks and financial institutions in Belgium quietly from your PC or smartphone. See bberger.net for further editorial
Because to evaluate the difference between rates, make a car loan simulation is an essential step to compare:
- the amount to be paid back each month (the monthly payment).
- the amount you will have to pay out of pocket to your bank, which is the total interest you will pay.
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What is the difference between a rate of 2.00% and 2.65%?
How many USD will you pay in addition between a rate of 2.00% and 2.65%? Unable to encrypt the difference without doing a car loan simulation for your amount and duration.
The result of these 2 simulations in the example above shows:
Auto loan of 15.000 USD in 5 years:
- 2.00% => 763.80 USD interest paid.
- 2.65% => 1,151.00 USD interest paid.
So the difference is 387 USD between the highest and lowest car loan rates. A not insignificant amount that proves once again that it is interesting to make simulations in auto loan!
With this sum you pay 1 year of auto car insurance if you are a good driver.
Doing auto loan simulations also lets you see how far you can reduce or lengthen the repayment term of your car loan: this term is regulated by law according to the amount borrowed.
Remember this for your auto loan simulation:
The longer the repayment period, the lower the monthly payment but in total you will have paid more interest.
And vice-versa: the shorter the repayment period, the higher the monthly payment but the lower the total interest.
Example: 15.000 USD to 1.99% :
- reimbursed in 4 years: $ 325.24 / month and $ 611.52 interest.
- reimbursed in 5 years: $ 262.73 / month and $ 763.80 interest
As shown by the result of the 2 auto loan simulations, the bank earns USD 152.28 more if it lends you the same amount (USD 15,000) at the same rate but over a longer period of 1 year in this specific case.